Saturday, April 26, 2008

Most marketers make the mistake of finding a product before they have a market. But unless people are actively searching for your product online, you’ll never make a sale. The trick is to find a group of people with a common problem they’re trying to solve and then solve it.

After you’ve done this, use what you’ve learned to create a product for a market that already exists — and do it better than your competitors.

WRITE SALES COPY THAT SELLS

On a website, your copy has to do the selling for you. There’s a proven formula for writing sales copy that’ll take visitors through the selling process from the moment they arrive: Arouse interest with a compelling headline, describe the problem your product can solve, show them why you can be trusted to solve the problem, add testimonials from people who’ve used the product, talk about the product and how it benefits the user, make an offer or a guarantee, create urgency and, ask for the sale on a website.

DESIGN AND BUILD AN EFFECTIVE WEBSITE

Remember to keep it simple. Your website is your online storefront, so be sure to make it customer friendly. You have less than 10 seconds to grab a visitor’s attention before they’re gone. Keep it simple and direct.

How do you get traffic to a brand-new site? Pay-per-click advertising, which has two advantages: the ads show up on search pages immediately and they allow you to test different keywords, headlines, prices and selling approaches. Not only do you get traffic immediately, but once you’ve figured out what keywords are working best, you can use them throughout your copy and code, which will help your rankings in organic search results.

ESTABLISH AN EXPERT REPUTATION FOR YOURSELF TO DRIVE EVEN MORE TRAFFIC TO YOUR SITE

People use the Internet to find information. If you provide valuable information for other sites to use — and include a link back to your site — you’ll get more traffic and better search engine rankings. Give away free content, like articles, videos or other useful information, and distribute that content through online article directories and social media sites. Every site that posts your content will link back to yours, and search engines love links from relevant sites and will reward you in the rankings accordingly.

USE THE POWER OF E-MAIL MARKETING

When you build an opt-in list, you’re creating one of the most valuable assets your online business can have—permission to send visitors e-mail. Why is e-mail marketing so valuable? You’re giving potential customers something they’ve asked for. You’re developing lifetime relationships with people in your target market. The response is 100 percent measurable. It’s cheaper and more effective than print, TV or radio advertising because it’s highly targeted. It can be almost entirely automated. Anyone who visits your site and opts in to your list is a very hot lead. And there’s no better tool than e-mail to let you effortlessly follow up with those leads.

INCREASE YOUR INCOME THROUGH BACK-END SALES AND UPSELLING

One of the most important Internet marketing guidelines is to develop every customer’s lifetime value. They may come again. Closing the first sale with a customer is by far your most difficult task—not to mention your most expensive one. Offer products that complement their original purchase, send out electronic loyalty coupons they can redeem on their next visit and offer related products on your “thank you” page. If you reward customers for being loyal, they’ll become even more loyal to you in return.

START AN AFFILIATE PROGRAMME TO MAXIMISE YOUR SALES AND REVENUE

Once your business is up and running, it’s time to launch your affiliate program. Affiliates are people who promote your products on their sites for a cut of the selling price. Every time they send you a buyer, you pay them a commission.

An affiliate programme is a simple, low-maintenance way to grow your business. Once you get your program set up, all you have to do is share your marketing materials with your affiliates and send out checks when they make sales. Once your business is up and running, it’s time to launch your affiliate programme.

AT FIRST glance, Chennai-based Anantara Solutions might look like another manufacturing company. It designs products, buys components from some 25 supplier companies spread across India, China, Russia, Singapore and the Malta island and assembles them. So typical of any assembly line, but Anantara is an information technology consulting company.

Started by a group of former employees of Satyam Computer, Anantara has taken a novel path to technology services business and calls it the ‘second generation outsourcing.’ The business model is based on using the best practices of the manufacturing sector in IT: Design and integrate, but leave the intermediate steps to an ecosystem of component suppliers.

And leading the innovation at Anantara is none other than GB Prabhat, who was one of the pioneers in taking the Indian software outsourcing industry to consulting league. Years ago, he helped start what is today a hot trend among services companies by cofounding Satyam Renaissance Consulting. After moving out of Satyam, Mr Prabhat contemplated ways to integrate business consultancy expertise and information technology prowess seamlessly to create a combined offering. “I was disenchanted with the existing methods for harnessing the value of IT. Most IT efforts were and continue to be cost-focused rather than getting value from IT investments that will improve business performance,” said Mr Prabhat.

And his search soon turned towards the so-called old economy. “When I was confused by how one company would gain leadership in such a vast spectrum of capabilities, I was struck by the global manufacturing model widely employed by the auto, electronics and the consumer goods sector. Toyota, the pioneer of this integrated supply chain management model, was an inspiration,” Mr Prabhat said. So, just as Toyota and Cisco bought from the global best companies a vast proportion of the components and subsystems that would go into their final product, Mr Prabhat thought, IT and consulting firms too, could assemble their business solutions by sourcing parts from partner firms. Anantara’s departure from the traditional algorithm has helped it evolve a network of 25 companies with a collective employee strength of 3,000 that it can leverage to sew up a solution.

Further, the company also works with partners who stock up on reusable components and don’t write all codes from scratch. “In bigger companies, there is a huge disconnect between groups and there hasn’t been much effort in building components that can be part of a library,” Mr Prabhat said.

GB Prabhat of Anantara Solutions

This global franchise helps Anantara to optimise the use of talent, cost and time. For example, the company has a supplier in China, which charges $8-$10 an hour for a service, half of what it costs in India. That firm, which subscription-based websites, has made a security program required for every website reusable. Often, a little tweak is all it takes to customise it to a given project, thus saving on resources.

Mr Prabhat uses an everyday analogy to explain how automation tools can spruce up efficiency. There are three ways in which you can buy food. You can get prepared food in which case you accept what is available and the price it is offered at. Or you can go to a restaurant, which will cook everything from scratch. The cooks there will start peeling the vegetables after you order. But imagine an eatery which keeps a combination of gravies and semi-cooked food. It can work to any configuration and produce a finished food with little effort.

So, just like the food business, IT has three models. In the first case, you have the software products where you need to adjust yourself to use them well. The second case is the software services space, where they do the coding from scratch and which is a labour intensive model. The intermediary case is where the automation tools fit.

“Cost of manpower leading to a decline in profit margins and the rising infrastructure costs are driving automation in the IT industry today,” Mr Prabhat said.

The Anantara model, though different and new, crossed the initial hurdles of acquiring clients quite easily. “The senior management’s past reputation was a key factor in getting clients. But, manufacturing companies are not that surprised with this outsourcing model because IT is doing now, what they have been doing all along,” says Mr Prabhat. The eight members of the management team were senior executives at Satyam Computer Services, who grew quite close while they built Satyam’s consulting practices from scratch. The company gets 40% of its business from India and 60% from abroad. While the Indian projects are mostly in the manufacturing and logistics space, the projects abroad include verticals such as media and entertainment. It is working with an European player involved in Internet Protocol Television and movie distribution. “We are advising them on the more efficient use of their hybrid platform,” Mr Prabhat said.

Earlier this year, Helion Venture, led an investment of $6.5 million in Anantara solutions. The other investors include Walden international, SVB Financial Group and a US-based venture capitalist, Christian Wedell.

Article Resource:Author: Chandra Ranganathan is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

We are a start-up and we don’t have a brand.We want to expand by hiring more, but human resource consultants are expensive. In some cases, they charge more than the hiree’s one month salary as commission.We can’t afford this. How do we go about hiring good talent without spending too much that can strain our meagre resources.

The second question is how do we motivate existing employees when we hire more. As the staff strength grows, they start feeling neglected and begin to leave for bigger brands.

How do we deal with this?

On the first question, it is a very tricky area. If the entrepreneur’s need is special and he has no network to feed in the talent required, then it is imperative to have an HR search firm working for him. What you could do in this case is try and negotiate with the consultants. For example, enter into a longer-term contract with them saying you would hire more people down the line and have an exclusivity contract with them. May be this would get you a better deal in terms of cost-to-the-company. You could also make contingent arrangements wherein the fee would depend on the calibre and quality of the talent supplied. The industry norm is that these consultants charge a certain percentage of salary that the hiree gets. Negotiation is the best way out of this dilemma. Search consultants are like real estate agents. They get paid if they find you the right asset. So you can base their fee on the value of the asset they find you.

The second problem is pretty typical. Today, every entrepreneur in India faces such a problem. There is no easy answer to it, but there are multiple ways to address the problem. The norm for most companies is to pay the market rate or not get talent at all. You could tap into your existing people and not look outside and train them to do any new task that may have come up. But if you look outside, you have to accept that internal inequity is always possible. The decision is solely yours. Before hiring, also ask is it a long term need or a short term need? If it is short term, do not risk inequity. Hire part-time consultants to carry out the new responsibility. If it is a long term need, then you have to figure out who are the right guys for the job, internal or external. If you realise that the choice is an external skill set, then you have to shift to risk mitigation. Communicate the value of the new hire to your existing employees. Poor communication with the employees brings in inequity. Talk to employees about the need to hire from outside. What additional value the new person brings to the company and why is it fair to pay a higher remuneration to the new person. When you do that, you have built support for the new hire. And as is the case with most employees, they are rational people. They will understand the situation. There may be cases when your existing employees also want to be part of the new responsibility. Get them to shadow this new guy and learn from him. And when future opportunities arise, try them out. Lastly, the only thing people resent is when they feel they’re being taken advantage of. Don’t ever be unfair to your existing people.

Honourable examples apart, are venture capitalists in India generally risk-averse? Do they act more like private equity players?

WHEN Sujai Karampuri started soliciting venture capital investment for his fledgling business, Sloka Telecom, in 2005, he was 31 and the company was two years old. Both were too young to be funded, some VCs told him. Some others said the firm would fight a losing battle against giants such as Nortel and Alcatel. Still others were hesitant because the network infrastructure business that Sloka had chosen, was in a downtrend. The start-up approached about a dozen venture capital firms in India, but was declined each time.

Mr Karampuri’s experience is typical of hundreds of entrepreneurs in India, who find it nearly impossible to raise venture capital funding for their new businesses despite having a proper business plan and a good team. A growing tribe of business aspirants, as well as many venture capital managers themselves, say VCs adopt a very cautious approach in the country, which is just breaking into the business of start-ups. These investors, whose mandate must be to invest in new ventures and help businesses take shape, often act like private equity players and invest only in proven business models with assured cash flow. Is this a violation of the spirit of venture capitalism, just a passing phase in India’s entrepreneurship learnings, or is the quality of entrepreneurship and business model so low that VCs can’t help them even if they wanted to?

Spurned by VCs in the country, Mr Karampuri turned to those abroad. They either asked him to talk to their India offices, which brought Sloka back to square one, or told him to shift its base closer to where they were. With that option closed, Mr Karampuri weighed his next move. A typical start-up in his capital-intensive business needed $20 million. Trying to compete in an innovation-driven segment, Sloka needed $6 million for research and development alone. He figured that while entrepreneurs had to bet on the one thing they were pursuing, VCs had options from various suitors. He decided to end his search for VC investment and look out for angel investors. This time, he was successful. There has been no looking back since and Sloka’s business model was vindicated recently, when its technology was used to set up a WiMax network in the French town of Saint Medard en-Jalles.

Senior entrepreneurs and experienced fund managers in the venture capital industry say there is much justification in the criticism. Emerging markets such as ours will doubtless involve more risk, but the biggest rewards from the future are also here. Unless the VCs overcome conventional wisdom and become open to young age and radical ideas, they will miss out on the better opportunities.

But then, they also add that advanced nations, too, have gone through this phase when everyone was trying to figure out the concept of acceptable risk. Today, venture capital firms in the West take a lot more risk and have found out gems that would have been rejected in a cautious and ‘sensible’ approach. “As an entrepreneur who was once in the Valley, I can definitely say that VCs there have a larger risk appetite. This does not mean that VCs in India are not taking risks. Instead, they are taking as much risk as their mandate allows,” says Chandigarh-based entrepreneur Puneet Vatsayan, who co-founded an e-commerce platform company. “In a lot of ways, you can say that India is going through the excitement and learnings that the US went through in the 60s and late 70s,” he says.

Mr Vatsayan says it is only a matter of time before a virtuous cycle builds up in the country’s entrepreneurship scene. Mature and risk-aware entrepreneurs, backed by well thought-out business models, will be met by riskfriendly venture capital firms open to new ideas.

Venture capital industry has been substantially active for only a decade now. Already, there are success stories that inspire newcomers in both business-making and investing. Serial entrepreneur Rohit Agarwal, who founded techTribe, says businesses like Genpact, Naukri.com and JobsAhead are becoming large and will soon spawn new entrepreneurs from their stock of senior staff. “The seniorlevel and mid-level guys from these companies will be out to be entrepreneurs tomorrow. They will getting easier funding as they have been part of growing a company. In the Valley, most people raising funding are doing it for the second or third time around,” he says.

Sasken Communication Technologies CEO Rajiv Mody cites the example of Intel’s early journey through the 1960s. People didn’t understand semiconductors back then, but once they saw a success story there, there was soon a flurry of investment in that space. “The VCs in the West have a culture of innovation. As we see high risks yield high returns, we will see more people taking these risks.”

India also lacks institutional structures that can ease the way for venture capital flow. While business risks may be the same here and in the US, systems suffer inefficiencies in India, says Reliance Technology Ventures CEO Harshal Shah. For instance, the legal process for the formation or liquidation of a company is still long-winding and tortuous. “In the US, there is an institutional-like structure that has been built around venture capitalism. There is the concept of limited liability partnership, which hasn’t caught on in India. Then, there is also an accreditation system in place for VCs (there),” he says.

But at the core of many failed VC pitches is the entrepreneur’s inability to convince potential investors of his or her risk-taking ability. Raising capital is not a way to palm off the risk as some entrepreneurs might tend to believe. “Many ideas are just ideas, where the ideator himself is not willing to take a risk,” says Mr Agarwal, who is now working on his fourth venture. “Instead he wants the VC to take the risk. VCs want to see that you are willing to bet your career on your idea.”

There is also the problem of scale. Some businesses just can’t grow beyond a certain point. Rahul Khanna of Clearstone Ventures points this out with an example, “A hairstyling salon for children will not be a Rs 100-crore company in five years. It just cannot happen.” In a company without potential for scaling up, few VCs will show interest. So, the problem may be more basic in a business pitch than can be solved by repeated pleadings with more VCs for money.

“There are businesses that do not match our investment return threshold. This may not be the entrepreneur’s fault. It could be because the market isn’t ready for the idea. There is a much greater risk in a smaller company,” Mr Khanna says. “Entrepreneurs have a tendency to talk about a large opportunity, they don’t talk about how they are going to win.”

Venture capital firms are inundated with hundreds of pitches from professionals, genuine entrepreneurs, wannabes and hustlers. Occasionally, they put money where they shouldn’t and fail to invest where they should. And VCs, who had made either mistake, often laugh at themselves. Bessemer Venture Partners maintains an antiportfolio of what it calls “an unparalleled number of opportunities to completely screw up.”

The venture capital firm, which once invested in a wig company and French fry maker, missed out on several more lucrative opportunities, spurning repeated approaches. As per Bessemer’s own account, its managing partner David Cowan, listed as one of the world’s top 10 venture investors, was visiting a college friend when she tried to introduce Cowan to “these two really smart Stanford students writing a search engine.” Students? A new search engine? In the most important moment ever for Bessemer’s anti-portfolio, Cowan asked her, “How can I get out of this house without going anywhere near your garage?” The company was Google.

Article Resource:Author: Jacob Cherian is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

WHAT happens in a year that makes it the make-or-break-period for a small business? People spend most of their start-up money. They don’t have as many orders as they need to pay their bills. And people don’t anticipate the expenses that come up. Also, most entrepreneurs need to build up their markets and loyalty, slowly. Maybe 1% of the people have an unbelievable product, but most have to build up their customer base and they end up running out of money before they get there.

The three key things that have to happen within the first year to ensure that a business doesn’t fail.

Get to know your product, get to know your market, and get good employees. You have to have good people to back you up, and you have to know your target market or you are wasting your time. If you have the wrong market, you have to keep testing to find out what that market is.

What is crucial for an entrepreneur to know when starting his or her business that might help it survive?

They should know what their goals are and what they want out of the business. Do they want to simply make a living? Do they want to end up being a big company like Google? Do they want to stay local or sell nationally? They have to have some goals to know what they are going to be and what they are going for.

What is that something, which often happens during that first year, that can overrun a business if it is not dealt with?

One of the easiest things is to get behind on direct taxes. And once you get behind, it starts to mushroom. The officials won’t come after you right away, but they will get you in due course. Another thing: You almost have to go into business thinking that you are not going to make a fortune initially. In the first year, you need to make a foundation first. And, in the beginning, you have more bills than you know what to do with.

Will an owner’s attitude affect the entire business. How so?

Sometimes owners go into a business thinking, “I’m king. I can do what I want.” It turns out to be the opposite. The people working for you pick up on that attitude, and if you are vague or indifferent with customers they will be, too, and your customers will not come back. It can ruin a whole business.

Some think losing a big account is the end . Is it really so?

First, you should never take an account that would ruin your company, if you were to lose it. You can lose an account for any number of reasons. A larger account has a lot of expenses. You need to think about what you would do, if you lose that account, so that your business will not go down. You can’t let it shut you down. You should have backup sources and not give that big account everything. That way they can’t take everything if you lose that account.

How should one deal with competition?

Know what your competition is doing. You can’t run a business and ignore it. If you are a retailer, shop your competitor’s store or send in mystery shoppers to see how they treat customers. Check their website to see what they are doing. They might be announcing something new, and you don’t want to be caught off guard. Hopefully, you have something that you are working on and it is better. That way you don’t have to get into a price war, because that’s when everyone loses. You need to be aware of your competitors or they will eventually pass you by.

Public speaking skills are critical to the success of every leader. Over the past several years, I have been interviewing, observing, and writing about business, academic, and political leaders who have the ability to influence their audience - leaders who fire up the rest of us. Whatever your political leanings, Senator Barack Obama (D-I11.) is one of them. For a look at what makes Obama's public speaking skills so effective, I outline four techniques this Presidential hopeful has mastered and explain ways to use them in your own repertoire.

1.Hold Out Hope

Like Winston Churchill, Martin Luther King Jr., John F. Kennedy, and Ronald Reagan, Barack Obama speaks in the uplifting rhetoric of hope. After his defeat in New Hampshire, Obama's political oratory was so hopeful he sounded more like a winner than a runner-up. Obama knew a hopeful message would embolden his supporters. In a speech on Jan. 8, 2008, Obama said, "We know the battle ahead will be long. But always remember, no matter what obstacles stand in our way, nothing can stand in the way of the power of millions of voices calling for change... We have been warned against offering the people of this nation false hope. But in the unlikely story that is America, there has never been anything false about hope."

You are the leader people want to believe in. Your customers and employees are bombarded by bad news - the credit crunch, a housing slump, an economic slowdown - but they are eager to hear something positive. That doesn't mean leaders stick their heads in the sand - far from it. Inspiring leaders acknowledge the situation but also remind people of reasons to be optimistic.

2.Use Rhetorical Devices

Many observers say Obama sounds like King. This is because he uses some of the same techniques that made King an electrifying speaker.

Parallel structure. We can thank the ancient Greeks for this rhetorical tool - they called it "anaphora." It simply means repeating the same word or expression at the beginning of successive sentences or phrases. One of the most famous examples is King's "I Have a Dream" speech. "I have a dream that one day this nation will rise up and live out the true meaning of its creed... I have a dream that... I have a dream..." Obama uses the same device frequently. In his Iowa victory speech on Jan. 3, Obama said, "You have done what the cynics said we couldn't do. You have done what the state of New Hampshire can do in five days. You have done what America can do in this new year."

Anaphora's sister technique is called "epistrophe." It is the repetition of a word or expression at the end of successive sentences or phrases. For example, in Obama's New Hampshire speech, the expression "Yes, we can" rallied thousands of supporters when used like this, "It was a creed written into the founding documents that declared the destiny of a nation: Yes, we can. It was whispered by slaves and abolitionists as they blazed a trail towards freedom through the darkest of nights: Yes, we can. It was sung by immigrants as they struck out for distant shores and pioneers who pushed westward against an unforgiving wilderness: Yes, we can."

Alliteration. Both Kennedy and King were fond of this device that strings together words starting with similar sounds. At the 2004 Democratic National Convention keynote speech that brought Obama to prominence, he said, "Do we participate in a politics of cynicism or do we participate in a politics of hope?" In 2005, during a commencement speech at Knox College, Obama described America as "a place where destiny was not a destination, but a journey to be shared and shaped..." When speaking at the Woodrow Wilson Center for Scholars in August, 2006, Obama proclaimed, "The history of America is one of tragedy turned into triumph." In January's New Hampshire speech, Obama used alliteration again: "We have been told we cannot do this by a chorus of cynics."

Rich Imagery. Persuasive speakers have long understood the power of imagery to stir emotions - the creation of mental pictures through the words. In his 2004 speech, Obama described what he meant by the audacity of hope: "It's the hope of slaves sitting around a fire singing freedom songs, the hope of immigrants setting out for distant shores, the hope of a young naval lieutenant bravely patrolling the Mekong Delta, the hope of a millworker's son who dares to defy the odds, the hope of a skinny kid with a funny name who believes that America has a place for him, too."

3.Exude Confidence

In debates Obama appears unflappable, answering tough questions while maintaining strong eye contact. He doesn't fidget or shake his head when listening to sharp attacks from his opponents. While seated, he leans slightly forward. People will make an impression of you after only a few seconds. Pay attention to what your body is saying. Communicate confidence, competence, and control.

4.Use Dynamic Vocal Delivery

A monotonous speaking style lulls the listener to sleep, regardless of the power of the content. Obama knows how to enhance his delivery. Consider these three aspects of his delivery.

a)Pacing.Obama varies the speed at which he speaks. Very few sentences are delivered at exactly the same pace.

b)Volume.In his victory speech after the Iowa caucuses, Obama raised the volume of his speech with each sentence in the following paragraph: "We are one nation. We are one people. And our time for change has come."

c)Pauses.Nothing is as dramatic as a well-placed pause, and Obama knows it. He pauses at key moments to make a memorable impact.

Obama connects with millions of people thanks to his public speaking skills. Consider learning from him to influence your own audience.

Reference:Carmine Gallo[About the Author: Carmine Gallo is a communications coach for the world's most admired brands. His book, "Fire Them Up!", contains insights from top business leaders who inspire through the language of motivation.]

Thursday, April 24, 2008

SOME might call it entrepreneurship in reverse gear. But what did Badri Seshadri and K Satyanarayan, founders of cricinfo.com, do after they sold their immensely popular cricket website to Wisden? They did not start another online venture hoping to hit pay dirt the second time. They did not become technology gurus and hit the lecture circuit. They did not even stay on at Cricinfo as employees. They went back to the old economy and started publishing books.

Over the past four years, the Chennai duo have shown that innovation need not be confined to the online world, but can happen even in a seemingly routine business such as book publishing. They have sought to change the rules of the game in publishing, bringing in new ideas in the way Indian language books are conceived, presented and distributed.

“We had reached the stage, where, from shareholders, we had become employees. We could have been comfortable working at Cricinfo. But we wanted to run, build and manage things of our own,” says New Horizons Media co-founder and managing director Badri Seshadri.

After discussions and research, they decided to focus on the vernacular language publishing business. While climbing down from the internet high horse was one radical decision, to get into the challenging domain of regional language publishing was another. “The journey was like this; we wanted to work in the area of knowledge, in Indian languages. The online scope wasn’t great and, therefore, offline. If offline, then publishing rather than a newspaper or a magazine,” adds Mr Seshadri.

Analysis showed that one could be a publisher by spending very little money. “If I have to print 1,000 copies of one title, it will not cost me more than Rs 30,000 to Rs 40,000. Small books, with our relationship and all, will cost not more than Rs 5,000,” says Mr Seshadri. The end result was New Horizons Media, which brings out titles in Tamil, English and Malayalam.

Badri Seshadri (L) & K Satyanarayan Founders, New Horizons Media

At first glance, it seems impossible to visualise the transition from an exciting sports venture to a traditional regional publishing business. But, Mr Seshadri’s office cabin, at least, manages to bridge the gulf between the online and the offline worlds. When we caught up with him, the 36-year-old IIT alumnus was busy tracking the India-Australia match on his laptop, while his desk was littered all over with titles from New Horizons’ stable.

Casually dressed in T-shirt and tracks, Mr Seshadri’s wry sense of humour and candour is an antithesis to the stoic and serious image that one has of a publisher. Over the next hour, however, he donned the hat of a story teller as he took us through the plot, the protagonists, the story and the screenplay of a venture titled, ‘New Horizons Media’.

“When we examined the kind of non-fiction works in Tamil in 2003, they were invariably works on horoscopes, cooking, herbal remedies and numerology. Cooking was fine, at least, you can make something out of it, but the rest were complete frauds. The author’s background was unclear, but this category ruled the roost in 2003,” says Mr Seshadri.

Though a few books went beyond the astrology and cookery themes, the sales remained low. “They were not selling because they were written in hard-core, needlessly complex language. It had massive footnotes and mega introductions running to 70 pages. All this is great for academics, but had no use for common readers,” Mr Seshadri adds.

In a way, this inherent problem helped the company decide its content and theme. The founders decided to be completely contrarian and churn out more content in the non-fiction and knowledge-oriented category. This included biographies, political histories, finance and business. Interestingly, their best seller to date, is a title Alla Alla Panam, (Amass more money), an introduction to stock markets and has so far sold 60,000 copies.

The next challenge came in finding people to pen books based on the chosen themes. For this, the company tapped teachers, bank and IT employees already writing for magazines. And the writers had a simple brief — swallow the idea, use all available information and present everything as easy-to-digest stories.

Since starting in 2004, the company has brought out more than 600 titles in Tamil, Malayalam and English. Its imprints include Kizhakku and Prodigy. “Kizhakku is right now our leading publication, but we expect Prodigy to beat it,” Mr Seshadri said.

Traditionally, publishers meet sales requirements by stocking their books in Government libraries and selling the rest to local bookshops. According to rough estimates, there are about 600-800 bookshops in Tamil Nadu. On an average, if bookshop sales generate Rs 10 lakh per month, annually, the publisher would end up making only a crore. “We simply re-invented ourselves and started stocking books in existing outlets such as grocery stores, restaurants and medical shops,” Mr Seshadri said. This model of distribution currently accounts for 30% of revenue, but is expected to go up to 50% over the next year. The company is venture funded by Rajesh Jain of Emergic Ventures.

Article Resource:Author: Chandra Ranganathan is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

There's no shortage of ways to bust your image. Here are eight common mistakes executives make- and you should avoid - that have a negative effect on their leadership image.

Too much seriousness.

Leaders don't need to be serious to be taken seriously. Leaders who are overly reserved look wooden, stiff and uncaring. A smile goes a long way. Show that you can take a joke or handle pressure with graciousness and warmth.

Weak speaking skills.

In a media-saturated world, people know a good speaker when they hear one. The standard is high, and a leader with a flat or monotone vocal style, inappropriate volume or poor diction isn't tolerated. Whether talking one-on-one or speaking to a crowd, pay attention to how you speak, not just what you say.

Lack of clarity.

Of course, what you say is enormously important, too. Leaders who speak with clarity of thought and message covey an image of effectiveness in a way that a leader who rambles or speaks disjointedly does not. If the message is unclear and non-specific, the listeners will tune out and assume you don't know what you're talking about.

Self-absorption.

Leaders who overuse the words I, me and my are isolating themselves and not engaging their audience. People prefer to be a part of something, not just the recipient of your efforts. Even if something is your idea, your vision and your responsibility, keep in mind that your job as a leader is much bigger than yourself.

Lack of interest.

Think back to when you were in school - which teachers captured your attention and imagination? The energetic teachers who seemed to loved their job or the ones who lectured dispassionately from the podium? Energy, interest and passion for your work are incomparable assets. Are you interesting and genuinely interested in what you are saying and doing? Obvious discomfort It's painful to watch a leader who is uncomfortable in front of a crowd or awkward in conversation.

If you are tentative or uncomfortable in the roles you play, people begin to doubt your ability to be an effective leader - especially in difficult situations. Inconsistency. Over time, your image becomes tied to your larger reputation. If you have a reliable pattern of behavior - one that is reflected in what you do and how you do it - your leadership image will be seen as genuine. Inconsistencies, in contrast, form an image of a leader who is flaky, insincere or dishonest. Defensiveness. Confidence and assurance is undermined when a leader is on the defensive. An unwillingness to consider other views, a knee-jerk defense of your position or decision, or an inability to seek and hear feedback all undermine your image as a capable, effective leader.

Building a Leader's Image: Asset or Liability?

Your effectiveness as a leader is tied to your image.

"Your ability to project a leadership presence in the eyes of employees, customers and others is closely related to your ability to do your job well," says CCL's Corey Criswell. "Your image, then, can be either an asset or a liability as you engage in the tasks and roles of leadership."

A study of 150 executives who attended CCL's Leadership at the Peak program reinforced what Criswell and her colleagues have observed working with senior executives. The study, conducted by researcher Phil Willburn, shows that the image leaders convey has a significant correlation to perceptions of their leadership skills.

"In this study, leaders who conveyed a strong vision were rated higher on several important leadership skills than those who conveyed a weaker vision," Criswell explains. The leaders who conveyed their vision in a strong and positive way were also seen as stronger in areas such as the ability to lead change, being dynamic, competence in strategic planning, being farsighted, inspiring commitment, being original and having a strong executive image.

What is Image?

Leadership image is created by many things: personality, behavior, body language and speaking style, as well as formal status and physical appearance. Simply stated, your image is the concept that others form about you as a result of the impressions you make on them. Your image may be the conduit through which people initially know you; it can have a great impact on how they get to know you as a person and as a leader. Whether someone is getting to know you through a first meeting, over time or even through the media, your image is being broadcast and your reputation is being formed.

Managing Your Image

Fortunately, you can have a great deal of control over the image others have of you. You can choose to be more open and show a side of yourself you normally keep hidden. You can change how you communicate by improving both your speaking and writing style. You can develop new skills that contribute to a reputation as an effective leader.

In the study of CEOs mentioned above, each leadership factor that reflects a positive or negative image is also tied to specific behaviors. "That means with awareness and practice, you can change your behavior and improve your leadership image," says Criswell.

Crafting your image requires you first to gain a clear picture of the image people currently are perceiving, then to decide what image you would like to portray and, finally, to develop the skillsto close the gap.

Image and Authenticity

Many executives who attend CCL's Leadership at the Peak program struggle with their authenticity as leaders, especially when dealing with those outside their closest circles. They often feel such a strong need to maintain their executive image that it becomes the number one obstacle to authenticity. They are unsure how to be authentic, genuine leaders and at the same time work to craft their image.

If you are struggling with this quandary, try to rethink your understanding of executive image. "Often, successful people have defined their image more narrowly than they need to. They unnecessarily put tight limits on themselves, trying to maintain a powerful façade," says Criswell.

"We've found that revealing one's personality and humanness is a better sign of effective leadership."

Reference:This article is adapted from Building an Authentic Leadership Image, by Corey Criswell and David Campbell (CCL Press, 2008).

Wednesday, April 23, 2008

Indian marriages may be a very private family affair, but organising them is increasingly becoming a pursuit for professionals.

THEY say gods and angels shower their blessings from heaven when two young people get married. But at a wedding in Andhra Pradesh, there were also three helicopters. As the daughter of a rich timber merchant went round the holy fire and stuck her neck out for the mangalasutra, the choppers showered flowers on the entire town. The 10-minute adventure cost the father about Rs 10 lakh. It had a more lasting impact on Deepak Chawla, then 22-year-old, who began marvelling at the great business opportunity that Indian weddings have become.

Mr Chawla soon quit the event management company that organised the chopper spin and the rain of flowers and has started his own firm, Elan Entertainment. He has picked up experience handling the lucrative, but less colourful corporate events and has geared up for the wedding management business. “The business is a sure-shot for six months a year... People are too busy to arrange the weddings themselves. So they get wedding planners to do it.”

Nitinn Raichura has built palaces and set up beachfronts as part of his business spanning 35 years, but an Egyptian pyramid in Mumbai was a novelty even for him. A 25-foot tall structure forming the backdrop for a decor that cost Rs 14 lakh. A wedding attended by as many as 2,500 guests in lavish clothes. This was Mr Raichura’s biggest moment. It was also a sign that Indian weddings, perhaps the most elaborate ones globally, have become a veritable industry in their own right and offer a compelling opportunity for entrepreneurs.

But it is not just the lavish weddings that spell big business for entrepreneurs. It is an industry catering to all economic sections from the very poor to the very rich. Though a very private family affair, organising a wedding is increasingly becoming a pursuit for the professional. In Mumbai alone, an estimated 10,000 service providers have fashioned their business around the concept of wedding covering venue decor, saree draping, fashion designing, flowers, jewellery, make-up, nail-styling, music management, logistics, honeymoon travel, photography and a growing list of other options. With a different culture every 200 kilometres, many of these businesses are highly localised but there are certain common business themes that have a national market.

The Indian wedding defies a single description. Depending on the region, religion, caste, language or beliefs, a wedding may be over in five minutes or go on for five days. Some have horseback processions, others have tractor caravans. Some families place emphasis on clothing, others on decor, still others on music and partying. The jewellery could just be a ring or a mangalsutra or it could be a truckload. It is this variety that attracts innovative business aspirants who make a killing every time a soul in love steps into the bliss of matrimony.

Organising a wedding in India starts with the toughest customer in the world: the mother-in-law. Gender roles have changed over time, but traditionally, it is the boy’s parents who lay out the specifications but it is often the girl’s parents who pick up the tab. In either family, it is the lady of the house who dominates the negotiations and rightly so. They have better expertise in caring for family and guests and they do remember the nuances of rituals. Successful wedding business providers say an entrepreneur must master the art of working with the mothers-in-law in order to get business and achieve customer satisfaction. “Dealing with a corporate is easier as compared to dealing with a family hosting a wedding. It is very personal and it is their own hard-earned money,” says Partib Thyagarajan, co-founder of WeddingSutra. In fact, the idea for an online wedding portal came to WeddingSutra’s founders when Thyagarajan’s colleague Madhulika Mathur got married and had to go through the offline route.

Weddings in India have always been a big occasion for the women of the family and the business around weddings is no exception. Industry players say that the business is dominated by women, often rich women with a sense of feminine style building a part-time operation. “In Malabar Hills, every building will have at least one rich lady with the contacts and the skill to run a wedding related business,” Thyagarajan says. Such a neighbourhood, housing as it does some of India’s richest, also enables these entrepreneurs command a comfortable premium for their services. “If these women were to operate from Dadar or Vashi, they would be able to command only a tenth of what they are currently doing.”

With all discussion for the contract beginning with the matriarch, the wedding solutions business has a formidable entry barrier. Youthful energy doesn’t count for much here as experience, track record and knowledge of traditions. “You need some sort of experience and grey hair to get respect from the family. If a person were to try and plan a wedding straight out of an event management course, I would call him a fool,” says Thyagarajan. No family would trust a wedding with an inexperienced start-up. So, experts say, entrepreneurs can break into this market effectively by joining hands with veterans and specialise strongly in one field.

Some families emphasise on what they need and budget doesn’t matter there. But there are several weddings where the requirements have to be fitted within a budget. As young couples increasingly fund their own weddings, the latter form will gain currency. So, entrepreneurs must have the flexibility to plan for both spending and saving, depending on the client. There is also a tendency among urban families to move to hotels and other such venues to allow for late-night partying as part of the wedding festivities. “A lot of people want to go for a five-star event with a smaller crowd” instead of large open-air venues where music and the noise of partying will have to be wound up by 10 pm, says Lloyd D’Souza of RozBridal.

Raichura says the industry is transforming with the changing tastes of the younger generation whose consumption patterns have been fuelled by the rapid economic growth over the last 15 years. “Nowadays, we see new colours, new flowers and lighting techniques in Indian weddings.” Earlier, floral decorations were mainly about marigolds and lilies, but now ‘English flowers’ such as carnations, lilium and gladiolus are all the rage. Also, “earlier we had shamianas. Now, we have iron structures that can be put up in half the time.” Entrepreneurs planning to enter the wedding business must start by watching films. Experts say Bollywood fashion, with all its bling, determines much of the style in today’s weddings. Even make-up artists of stars are found to be much in demand at elite weddings.

The stock market boom may have inspired the nouveau riche to spend lavishly on themed weddings and helicopter floral blessings, but the Indian wedding is an evergreen business irrespective of the economic conditions. The rules may change and so may the rituals, but the wedding remains the central part of Indian family life. Not surprisingly, more and more entrepreneurs are saying “I do.”

Article Resource:Author: Jacob Cherian is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

In these globalised times, a US economic recession or a slowdown in the domestic economy could hit your business. A survival guide for the tough times.

CUT COSTS

Have a look at your business and figure out where you could save. If three employees are doing the job of one, you may need to make job cuts. Additionally, if you have two product lines and one is successful while the other one isn’t, consider selling off that division. When times are tough, it’s best to focus on core markets and spend money in those areas, not in areas that haven’t been more profitable.

RATCHET DOWN INVENTORY

The last thing you’ll want to do is get stuck with shelves of needless inventory. For a better idea of what you’ll need as the year progresses, keep an eye on leading consumer indicators. Also, establish inventory targets and ensure the sales and purchasing personnel are talking.

MAINTAIN PRICES

You may be tempted to slash prices to attract buyers from a recession-hit country. That could be a mistake. Sure, you’ll sell products but you’ll also cut your profit margins and likely to dilute your brand in the process. Plus, if customers decide to buy again from you in the future they may expect similar discounts.

RESERVE DISCOUNTS

Since you don’t want to dilute your brand’s value and you especially don’t want to start competing on price, tread lightly when it comes to offering discounts. Be sure to reserve them only for current, repeat customers.

FOCUS ON SERVICE

While expanding may open up avenues for growth, many small-business owners should focus on their existing customers and clients for a boost in revenue. Focusing on service is one of the best ways to add value without costing money.

INVEST IN EMPLOYEES

When the going gets tough, the employees you have will be your productivity all-stars. Make boosting productivity — within reason, of course, — a focal point. For those that rise to the top, be sure to reward them accordingly. You don’t want to lose your most productive people at this time.

FREE UP CASH FLOW

Be sure to free up your business’s cash flow by asking suppliers to extend payments dates. Also, if you have old debts, call them in. Having a good amount of cash on hand, especially in light of the credit crunch, will help you do everything from making payments to employees and vendors to spending on marketing campaigns, which may grow future business.

RENEGOTIATE CONTRACTS

If a contract, a lease or other obligation will soon be up for renewal, try to negotiate lower prices. At this point, you may be able to also make cuts. Take up a reality check of your expenses.

LOOK TO EXPAND

If you’re doing well for yourself, look for weaknesses and instability in your competitors. If they’ve been having trouble, you may be in a good position to pick up their businesses at bargain-basement prices. Their losses may be your gain.

Infovision’s domestic focus is a winner at a time when the glamour of BPO exports is fading.

STAYING power was what distinguished many successful entrepreneurs of the dotcom era who weathered the bad times and went on to make it big when the internet became a way of business. Till not long ago, Aditya Gupta’s business offering business process services to the domestic market was unfashionable because it did not earn the same kind of handsome profits or tax breaks that a BPO-focused on overseas clients enjoyed. Since then, however, the recession in the US, currency fluctuations and an attractive domestic market have turned many export BPOs looking back at India. This has, at last, vindicated the home-bound model that Mr Gupta’s Infovision has been pursuing.

Mr Gupta started his firm in 1991 doing direct marketing, loyalty programmes and managing data for airlines and hotels. “Telemarketing had not yet started in a big way but computers had started being used,” recollects Gupta. The challenges of the business were quite different from what they are today. The biggest challenge for the business was, for instance, to get 25 phone lines from public sector undertakings like Mahanagar Telephone Nigam. Leadership was not something new to Mr Gupta — his father PP Gupta headed CMC when it was just set up and his grandfather was in the civil services, but entrepreneurship was a bigger leap to take. “I always wanted to have my own business and something to do with technology,” claims Gupta, who started the business after 15 years of working for ICL, the UK-based systems integrator.

People often compare his business model with that of BPOs focused on exports. The business models of the two are quite different — investments in sales and marketing a not very high for a domestic BPO, knowledge of English is not always required, and there are no security issues involved in outsourcing to a location outside the jurisdiction of the country of the client. Also, there is no labour cost arbitrage.

Most of the sales activity for Infovision, for instance, was handled by its senior managers. Only now, is the 11,000-employee strong company setting up a dedicated sales team of around 11 people to target industries and firms that have the potential to be large outsourcers. Mr Gupta refers to an IDC report that estimates the size of the domestic BPO market at Rs 7,000-7500 crore ($ 1.8 billion). Of this about 18% is insourced (done within a group itself and not outsourced to third party vendors). This percentage is expected to go 32% and the overall domestic market to Rs 25,000 crore or $6 billion in some years, asserts Mr Gupta.

Infovision’s transition from a firm doing direct marketing and loyalty programs to a domestic call centre handling some of the big private sector and foreign banks, wellknown food and beverage chains, and pharma companies, happened sometime in 2000. The company lost a major client, which accounted for nearly 80% of its business, in the late 90s following a decision that disallowed airlines from running loyalty programs with travel agents. “This was the first major shock to our business. During those six months to one year we had to re-group and re-focus our entire business. But we learnt we’ve to broadbase our business and not focus on any single client or industry,” reminiscences Gupta.

Luckily for Infovision and Mr Gupta, the telecom boom was just beginning to happen in India. And it got some of its first clients for the call centre business from Bharti Airtel and Microsoft. From here on, it diversified into other clients and industries, including in some unconventional ones like food and beverages and white goods. “You’ll be surprised at the number of calls we get because cell phones have become so pervasive.” While the company initially started as a vendor to handle customer complaints for some clients, it gradually began seeing new business coming in from areas like handling dealers queries. About 20% of its revenues also come from international clients. The sales and marketing for the international business is done through a partner in the US. The decision to stay more focussed on domestic business was a conscious one, says Gupta. “If we had done more international business, we would have to spend much more on sales and marketing. Most of exportoriented BPOs are backed by large business groups or private equity funds. At our size, we could not do it,” he adds. There are other aspects where Gupta believes in going against popular perception. For instance, he doesn’t believe his business should be organised around industry segments. “That would be restrictive,” he says.

Article Resource:

Author: N Shivapriya is the cheif editor in the Economic Times and the article appeared in one of their successful columns called "Starship Enterprise".

Friday, April 4, 2008

1. Understand that you as an Entrepreneur is responsible for everything that happens in your business. You cannot delegate that responsibility.

2. The attitude of the Entrepreneur is reflected in the employees working in the business. If you don't like the attitude you see in your employees – look in the mirror.

3. Personal growth and business growth are not the same but they are closely related. When you stop growing as a person you stop growing your business.

4. Know that you don't know everything. It is not possible. When you come to that realization, investing in trusted advisors makes so much sense and it becomes an easy decision.

5. Life is short. Enjoy what you do and others will see that and be attracted to you. It is fun to work with and be around someone who is positive and excited about what they do. If you don't like what you do, find something else to do.

6. Give others credit for their contribution to your success. Everyone loves to be a part of something bigger than them selves and to be recognized for their contribution to the overall success of the organization.

7. Know that your success is tied directly to how well you motivate, manage, inspire, sell and encourage people. Your success, especially as you grow your business comes through the performance of others.

8. If you can't measure it how do you know it works? Measure everything.

9. You must understand how the business you are creating will help you create the life you want. There can be no misunderstanding. True success lies in creating a business that is consistent with and supports the life you want to create.

Thursday, April 3, 2008

With Valentine’s Day creating a big buzz among Indians and even surpassing Diwali sales, Let us check out how well-prepared entrepreneurs are.

START-UPS TAP A BIG POTENTIAL

IF BUSINESS is your first love, the coming time is yours to woo. The hesitant flirting the Indian entrepreneur started with February 14, St. Valentine’s Day, a few years ago has now turned into a fullfledged affair. Varied trades spruce up their offers in the run-up to the Festival of Love, which industry experts say has become the second-biggest business opportunity in the calendar, even surpassing Diwali and New Year. Businesses, so it seems, aren’t falling behind the changing festival mix of Indian youth.

For K Vaitheeswaran, who co-founded online retailer Indiaplaza, business around valentine’s Day has been growing by leaps since 2006. “Direct spending on Valentine’s day is nearly 30-40% more than Diwali, making it a rich opportunity for retail entrepreneurs to boost their topline,” he says. From gifts, candies to expensive gadgets, Indiaplaza helps lovers exchange articles through the internet, across boundaries and even away from their parents’ eyes. The first time Indiaplaza tried to cash in on Valentine’s Day was in 2002, but it was a washout then, with not much ‘awareness’ about the day.

In 2003, there were protests and agitations over Valentine’s Day celebrations across the country, Mr Vaitheeswaran recalls. But the tough beginning was soon followed by a surge in the day’s appeal and business started to boom. “(The protests) created more excitement about the day’s importance. And because the protests were offline, people switched to the ecommerce website to send their gifts across. Thereafter, the sales started showing a rising trend on this festive day,” he says.

According to US National Retail Federation, US consumers alone spent nearly $13.7 billion last year on Valentine’s Day shopping. This was a 22% rise from the past five years. As for the domestic market, an independent study on the consumer markets in India, presented at the 2007 International Marketing Conference, suggests that the Western fancy has started to take roots in Indian markets as well. The study noted that Valentine’s Day sales in 2007 were about 15% higher than that during Diwali at these retail outlets and this is expected to increase by 20-25% in 2008.

Only the Christmas season rings in bigger revenues. And it seems entrepreneurs in the country clearly aim to boost the day into first place as more and more start-ups start to capitalise on the opportunity.

Despite the pressure to buy gifts, most of the money spent on V-Day this year would keep up the trend set in the previous years. Spending would go to tokens of affection — cards, candies, flowers and nightouts. Floricultural start-up Ferns ‘N‘ Petals, for instance, is gearing up for the Cupid’s arrival in a manner unlike any other. Apart from selling flowers, Vikaas Gutgutia’s company is banking on service as a major differentiator for this year. The company has planned to offer midnight delivery service, in addition to selling cakes and chocolates with its flowers on Valentine’s Day. It is also offering its customer the choice of buying gold-plated flowers. Says Pawan Gadia, vice-president at Ferns ‘N’ Petals, who jumpstarted the company’s much-touted franchisee model, “Product innovation for such days is the key to success. You always have to think what different can you do this year which would excite the customer. A mundane run-of-the-mill product line each year does not help when you are working in such a business environment.” F’N’P is hoping to increase its Valentine’s Day sales by 40% this year, adds Mr Gadia.

What is a day of gifts without cards? According to Anil Moolchandani, founder & MD of Archies, Valentine’s Day sales account for nearly 12% of the company’s full-year sales, making it the single-biggest occasional sale period for his company. “The trick is to promote and market as much as you can when your business is linked to an occasional sale,” he says. “Essentially, occasional sales help you build a brand presence and to add to this with more and more companies joining the occasional bandwagon for this day, it is becoming easier for any start-up in this space to cash in on the Valentine’s Day sales,” he adds.

Archies, founded in 1979, introduced its first Valentine’s Day card in 1984 and it took sustained marketing efforts till 2000 for this occasion to “become critical mass for the company,” recalls Mr Moolchandani. Somebody once wondered cheekily why Valentine’s Day comes exactly nine months before the Children’s Day on November 14? The guys who make it all happen, the matrimonial websites, are also tapping into the business potential of Valentine’s Day.

Bharat Matrimony, one of India’s largest matrimony websites, sees the day as a raw material for its business. Says Murugavel Jankiraman, founder and CEO, “We are planning to ramp up the promotional activities around Valentine’s Day period considering that online activity for our website picks up around this period. Unlike other festival days, Valentine’s Day is connected directly to our core business, and it always helps to use such events, which directly relate to your core business as effective marketing tools.”

Like Bharat Matrimony, luxury bags maker Baggit too plans to leverage on this opportunity, “More than anything else, it’s an occasion to gift and dress up and clearly a fashion brand would see synergies in that. In fact, we are timing our sale this year on February 12, very close to Valentine’s Day,” says Baggit founder Nina Lekhi. “In case you have a product targeted for the youth, Valentine’s Day would be the point to test response to a particular campaign, which you might want to roll out on a larger scale later,” she adds. In short, what has worked for these entrepreneurs is the packaging of their products. “On days like the Valentine’s Day, there may be little sale in terms of quantity for many business start-ups, but the trick is to fix yourself a niche area and make it high margin business for yourself, as events like Valentine’s Day do not tend to be mass market phenomenon,” says Mr Vaitheeswaran. “With Love’s Light Wings Did I O’erperch These Walls,” said Shakespeare’s Romeo to his sweetheart Juliet.

For a start-up with aspirations to make a big mark on the competitive business stage, Valentine’s Day can give wings and plant a kiss of success on the entrepreneur’s cheeks of desire.

Article Resource:Author: Ritwik Donde is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

Tuesday, April 1, 2008

Has your product become a hit and are orders pouring in? This 10-step survival guide will help you think fast and react quickly when you wake up one morning to find the world beating a path to your door.

Take a Deep Breath:

While it’s only natural to want to celebrate the good news, remember that a big contract or great press doesn’t mean dollars in your bank account — at least, not today. So hold off on that Ferrari or exotic vacation. Also, remember that the additional sales you ring up will probably require you to lay out more money for people, materials and overhead — and may require you to borrow additional capital as well.

Map out a Strategy:

Make a to-do list, crunch the numbers and marshal your human and production resources. It’s always easier to fight a battle on paper than to shoot first and ask questions later. No matter how much pressure you’re getting from your customers to deliver the goods right now, you need to take the time to sit down and map out a plan of attack.

Get the Money:

Before you go on a hiring binge or start placing orders overseas, it’s important to figure out how much working capital you’re going to need to meet the market demand. Because employees and manufacturers generally won’t wait until you’ve sold the products and collected the money before you pay them, you’ll need a source of capital that you can tap immediately.

Reach out for help: Call on suppliers, personal contacts and use the internet to find extra hands to help you. If you think you can do it alone, think again. No matter how hard you work, there are only 24 hours in a day and you’ve got to sleep during seven or eight of them. That’s why it’s important to reach out to people who can help you. If your company already has employees, ask them to put in extra hours to help you get over the hump. If you’re a one-person show, you can reach out to friends and family members to help you or hire freelancers. But don’t commit anything for the long term.

Forge production partnerships: While there’s no shortage of suppliers listed on the internet, a reliable manufacturer that delivers high-quality goods is not so easy to find. Your best bet may be to contact your industry’s trade association and its leading trade publications for consultants and referrals.

Create a Distribution Network: As news of your product or service spreads, you may start getting orders from consumers and retailers all over the country. If you’re like most businesses, you’re going to need help selling and servicing those accounts. Rather than hiring a national sales manager and opening offices in major cities, a more cost-effective option may be to sell your product through manufacturers’ representatives. These reps (or rep firms) act as independent sales agents for multiple product lines and work on a commission-only basis.

Communicate with your Customers: Communication is the life-blood of any business relationship, but it’s even more important when your product or service suddenly takes off. The biggest mistake a business owner can make is failing to warn customers of shipping or production delays until it’s too late. This is especially critical in the apparel and toy industries where seasonality is important. Manufacturers who fail to communicate with key retail and wholesale customers may find themselves not only with egg on their faces but with unsold inventory in their warehouses as well.

Leverage your success: The hardest thing about achieving over-night success is keeping it going. The last thing you want is to get stuck with a warehouse full of pet rocks. Creating line extensions like the Chicken Soup books or the ‘For Dummies’ series is one way to keep your brand alive. Another is to find new markets for your products and services or new ways to publicise them.

Invest for the future: While it may be tempting to reap the profits from your hit product right away, it’s important to reinvest some of those profits. Whether this means paying down debt, buying new equipment, hiring another employee or opening an-other location, don’t pass up this opportunity to make your money work for you. It’s always cheaper to put your own cash to work in your business than to borrow money from a bank or give up equity to an investor.

Learn from your mistakes: After the excitement of the initial sales rush has died down, take a few hours to sit down with your staff to figure out what went right, what went wrong and what you think you could do better in the future. This will help you put a strategy in place for the next time you come out with a hit product — which could be sooner than you think!

Over the past decade, Google has been every entrepreneur’s benchmark for success through innovation. Besides its founding duo, Sergei Brin and Larry Page, there were a handful who saw the internet search engine’s potential and backed it when it was still being run from a garage. And here’s the Indian connection. Ram Shriram, who went to school in Chennai and later migrated to the Silicon Valley, was one of the pillars that built Google. Ram Shriram considers himself a guide for entrepreneurs rather than a mere cheque-writing angel investor. Known as the ‘Sherpa from Palo Alto’, he runs Sherpalo Ventures and also serves as the founder director at Google Inc.

Fundamentally two biggest applications on the internet are search and email. And there was a quantum order of magnitude improvement in quality of search at that time that Google presented that resonated with me and resonated with its early users. That is what prompted my interest in it. Agreed that we did not have a business model or a revenue model figured out at that point but you have to start somewhere small for you to grow later. And if u do that piece really really well then you may have a future as big as Google.

So was it their luck that they found an investor like you?

No, I would not call it luck. Not for me not for them. In my case, I do not think lightening strikes three times as it did for me. I had done Netscape and Amazon before I did Google. And then there have been more successes like Stumbleupon and mint which is a financial services portal aggregating personal financial information. Google is the most prominent one in my portfolio but it certainly was not just luck.

You have seen Google grow like no other dotcom in the internet space. Do you see another Google, may be, in India as entrepreneurship is on a high here?

Frankly speaking. No. Not in the internet space at least. The challenge in India to create another Google is not that somebody can not build a big internet company, I mean look at Naukri, it is a pure-play dotcom company. The market is limited by the size of the internet population which is somewhere between 30 and 40 million and unfortunately it is staying somewhat stuck at that level because we have a last mile problem. We don’t have an Digital Millennium Copyright Act equivalent law or a spectrum policy that opens up broadband spectrum. I have had conversations with the policy makers and unfortunately the pace at which it is moving is slower than I like. It is important for Indian dotcom space as the trickle down economics of having more Internet access is that it could generate more jobs, generate a great deal more new companies that can be bigger companies than Google. It not that the entreprenuership spirit is low so India is not getting a Google out, they can do it. Wipro and Infosys have shown that there can big companies build around outsourcing so Indian entrepreneurs can easily do it on the Internet.

Ok. So, what you are saying is if America’s Google was in the Internet space, India’s could be in some other?

Yes. Looking at the amount of innovation happening in India. I think there is a Google waiting to happen in the mobile space. I see somebody like Google coming about every 10 years. In the 80s it was Microsoft, in the 90s it was Cisco and Google in the period up to 2010 and there may be a garage start-up right now in some part of India in the mobile space that would set the tone for the coming decade. Lots of interesting content companies coming about as there are confluence of cellphones and entertainment content. The big success will happen on mobile and it would happen on mobile because the mobile market is growing by 8-10 million users a month and most importantly almost all users are attuned to the use of the technology on offer when you say mobile like it is with Internet in countries like the US.

But is there enough spark then in the Indian space for bigger companies to come out?

Absolutely. There is spark. We are in the age of entreprenuership in India. There are good market spaces to nurture businesses. But the Internet user base has to go up from 30 million to 100 million for any dotcom company to scale up like Google or may be also an Yahoo.

If any entrepreneur has to take lessons from Google, what would those be?

It’s not just about having a good idea and a vision. But it’s more about great execution as successes come with great execution. So what does great execution mean? Hiring great people, building right partnerships and more importantly than doing the right things success for a start-up, it is in figuring out the things not to do. This keeps you focused and finally making sure that you make the right choices in terms of capital i.e. making sure the right kind of people invest in you..

If you look at the dotcom players in India, there are a lot of ‘Me Too’s. For every Yaari.com , you have a Facebook. Comment.

I don’t think that you can make the characterisation that they are all ‘me too’s in the Indian market. What happens is that there are only so many market segments in the dotcom space, so you can only build companies in the market segments available to you. When you talk about segments like search, emails, social networking, since there are global giants like Google, Yahoo and Facebook. So the chances for scaling your own ‘me too’ here are far and few. But if you take something like jobs or travel, those are areas that need to be targeted more. Yes there is an Expedia for a Cleartrip, but those are not successful in India because they have not focused on India as a market. So just because a company exists in that space does not mean that you cannot build a success in the same space. Look at China, it has a company in each of these spaces where US dotcoms are dominant. There is 51jobs.com, then there is qqq for messaging. That proves that there can be a successes where the US already has a success. Having said this, there are growth areas like these but these areas have been invested in quite heavily. There are 6-8 companies invested in the same sector and there are all not going to be successes. I think there will be a shake out in terms of successes from the next set of venture backed companies. Nobody in India starting a web venture would die for lack of funding. There is a good angel network here as well. The law of averages however would now start to apply in the dotcom industry and only a small number would actually succeed. But this phase is still 2 years away.

A lot has been said these days about the US slowdown. Do you think the US recession affect the Indian start-ups?

I think the recession will affect the tech spendings. It hasn’t yet affected any start-ups and it won’t affect the start ups because unlike the 1999-2000 period it wasn’t the tech bubble that has caused the decline in the markets but a set of financial issues. Recessions are when great companies are built. If you look way back at Microsoft, Google, these were companies that were essentially born at the depths of the downturn because that is a great time to hire people and it is a time when valuations come back down to normal levels. It is, however, affecting the private equity companies and in turn the fund flow to Indian companies.

Article Resource:Author: Ritwik Dhonde is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

ONE key trait of entrepreneurs is to see opportunity in a crisis. When a company gets into financial trouble, it can make a typical employee quit in fear and find safety in another job. Then there are others, who will stick with the company and let events dictate to them. There are only a few who will use the chance to turn entrepreneurs. Ashis Nain is one of those who avoided the risk of job loss to embrace the risk of their own start-up.

At the age of 36, Mr Nain was otherwise happy as the chief operating officer of Elbee Services, the express logistics company that was only second to Blue Dart. But Elbee Services was in trouble as its foray into air cargo was struggling to cope with the business impact of some air crashes. Losses suffered as of March 2000 were close to Rs 36 crore. “Things were not moving in the right direction” and he decided to quit, Mr Nain says recalling his moment of reckoning. He loved the business and he would do something on his own.

And he incorporated ExpressIT. Mr Nain didn’t want a “plain vanilla” express company delivering documents or parcels to umpteen locations. He wanted to build a niche. Six months of research showed him that Blue Dart’s customised services to business users were going virtually unchallenged by other existing players. “Customers were getting uneasy about that and were looking for an alternative to the market leader,” he says. That need for a second player, which could hope to be one up on Blue Dart, with similar services led to the creation of ExpressIT.

ASHIS NAIN MD, EXPRESSIT

It all started with the pick-up and delivery of bank documents, debit and credit cards and such, but ExpressIT has since built a bouquet of services around this core offering. For instance, banking transactions such as issue of credit cards and loans require door delivery services, customer support and verification tasks.

A call centre does the marketing, a local agent helps in filling up the documents, another agency carries out verification and maintains database and a service provider delivers the product. ExpressIT wanted to straddle this entire supply chain. “What we told our customers is that having a single window is much more cost effective and convenient,” says Mr Nain. ExpressIT calls this customer management logistics and boasts of clients like GE Money, Deutsche Bank and ICICI Bank.

Another innovation is print & delivery. An online stock broking firm usually has various documents, which it has to print and deliver to its customers. It employs different agencies for these two functions. One that carries out the printing and another the delivery. “We offered to do both,” says Mr Nain.

Today, ExpressIT prints and delivers close to 5,000 documents for Networth Stock Broking each day. Mr Nain, though, believes that there is one reason why these service offerings have succeeded with customers. “While for a large organisation Blue Dart wasn’t flexible, we have been able to do that,” he says. With over 200 branches across India, ExpressIT clocked a turnover of Rs 32 crore last year.

With logistics being an important part of a growing economy, ExpressIT can hope to leverage its track record for bigger revenues. But even if there were to be a crisis in the industry, Mr Nain wouldn’t lose his sleep. As he recalls bailing out from a beleaguered company, he expresses confidence that his own start-up will seek to turn a crises into an opportunity to move to the next level.

Article Resource:The article appeared in The Economic Times, Mumbai in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".

HERE are five steps, each with specific actions you can take, to get you on the road to delegating effectively.

DETERMINE WHAT TO GIVE AWAY AND WHAT TO KEEP.

First, consider your strengths. What are you directly contributing to your business that is making it successful? Those are the things you should continue doing. The tasks that are outside your expertise or those that could easily be performed by others are the first things to delegate.

YOUR ACTIONS: Make a list of everything you do on a daily, weekly or monthly basis. Then go through the list and determine what’s essential for you to keep doing and what can be given away.

CREATE A PLAN

Consider what you need to accomplish and how you want the task done. In order for delegation to be effective, you must be able to tell someone what exactly you want him or her to do. Maybe ‘no one does it better than you’ because no one truly understands what you want to be done. So plan out what needs to be accomplished and exactly how you want it done.YOUR ACTIONS:

Create your processes. Determine what the final outcome should be and create the specific, detailed steps needed to get there.

HIRE THE RIGHT PERSON

The key to finding the right person for the job is to determine what skill sets your position requires. Once you know what skills you need, search for a person who has exactly the skills you need. Don’t just hire the first person who happens to be available.YOUR ACTIONS:

Look at the tasks being performed, and decide what skill sets are needed. When interviewing candidates, ask open-ended questions that allow you to discover if that person has the expertise you’re looking for.

ASSIGN RESULTS AND ACCOUNTABILITY

One of the most important steps to successful delegation is to plan ahead by determining what the end results should be. Picture what you want to be holding when those final deliverables are handed to you. Then communicate those expectations. And remember, all expectations have to be reasonable, clear and measurable. For example, you may want to require that someone ‘complete a minimum of 30 sales call per week’ as opposed to just ‘complete sales calls’. Accountability is not a bad word — there ought to be consequences if the results you need are not being met.YOUR ACTIONS:

Create specific goals, quotas or outcomes that need to be accomplished by the person you’re delegating work to. Effectively communicate those expectations, and create consequences if the results you expect aren’t being accomplished.

CHECK IN FROM TIME TO TIME

‘Set it and forget it’. Some people think that this rule applies to tasks that have been delegated. People are human. They make mistakes, they accidentally skip over things. Instead of leaving them alone once you’ve assigned them work, establish specific times you’ll check in to see how they’re doing.YOUR ACTIONS:

Establish a check-in schedule that works for both you and your employee. And then be sure to touch base when you say you will.

IT’S the nightmare that every businessperson experiences: a shouting match with a customer or client. Here are seven at the-ready responses that may help tame even the most unpleasant situation:

“Let’s go over what’s happened.”

This simple phrase covers several powerful areas. For one thing, by asking your client to recount the wrong, you’re forcing him to think, not just vent. That unto itself can smooth things considerably. On top of that, you’re letting the other person know that you’re genuinely interested in his or her version of what happened. Lastly, it deals you some time to listen and, hopefully, devise a solution to the problem at hand.

“Let’s get together to talk about this.”

If a client is screeching at you over the phone, suggest that you meet face to face to iron out what’s wrong. Again, that can inject some much-needed cooling down time into the situation. And, no matter if your customer is a quick-to-back-off bully or simply conscious of behaving more civilly face to face, chances are good that your conversation will be far more controlled and productive when you actually get together.

“Let’s have someone else hear what’s happened.”

Confrontations between customers and business owners are akin to two rams butting heads; not only is there little movement one way or the other, you can end up with a mountain-sized migraine for your trouble. Another way to defuse the situation and work toward a resolution is to call in a third party. This could be a partner or someone else with whom you work. Have them listen to the issue. Make sure this informal arbiter knows that he or she should approach the situation as objectively as possible; that may cue both you and your customer to do the same.

“Let’s see what we can do to resolve this.”

Having heard every possible side of the story, this reaffirms your intent to hammer out a solution that’s satisfactory to everyone involved. Not only that, but your commitment to a fair resolution also moves past the accusation and moves toward identifying what went wrong and taking reasonable steps to correct it.

“Let’s hear how you think we should solve this.”

Be selective in choosing this strategy. If you already understand what the client wants — and it’s unacceptable — then this is not the right line to use. But if a resolution isn’t obvious, you’re tossing the issue into your customer’s lap, which may help the person appreciate your perspective and, in turn, suggest a reasonable conclusion. Conversely, the customer may suggest a resolution that costs you and your company big, so you need to step carefully here. Gauge where the other person is with this tack — the more steam he seems to have let off, the greater the chances for success.

“Let’s talk about ways this won’t happen again.”

This is the death knell for what once was a customer tirade. Once more, this demonstrates your interest in both your client’s ideas as well as your ongoing commitment to solid customer care. Not only have you worked carefully to craft a suitable conclusion to the issue at hand, you also want to make doubly sure that this particular snafu never resurfaces. And, should your client offer ideas that seem reasonable, implement them to make certain the dead stay six feet down.

“Let’s use ‘let’s’ as much as we can.”

Of course, you wouldn’t actually say this out loud, but note that the prior six ideas all begin with the first person plural. No matter how you approach the problem of a peeved customer, try to be as inclusive as possible in every solution you offer. For one thing, that immediately defuses the “us versus them” landmine. For another, you also let the person on the other side of the issue know that you consider a common understanding as an important outcome to the discussion.

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